News Now

Washington

Interchange work will continue CUNA says

WASHINGTON (5/17/10)--While Sen. Richard Durbin late last week succeeded in adding interchange fee restrictions to the Senate’s financial regulatory reform package, Credit Union National Association (CUNA) President/CEO Dan Mica on Friday said that “time remains to mitigate the effects” of Durbin’s amendment. In short, the interchange amendment offered by Durbin would assert government interventions on interchange fees. While CUNA’s attempt to defeat Durbin’s amendment altogether was not ultimately successful, CUNA and credit union representatives did convince Durbin to insert language clarifying that merchant discounts can only differentiate between card networks, not individual issuer’s cards. In a letter to credit union representatives, Mica said that it was important to note that Durbin views the issue “as one of big banks versus small businesses,” and “thought he was assisting credit unions in exempting financial institutions with assets of $10 billion or less from key requirements.” Durbin also worked with credit unions to remove language that would have made the amendment “even more onerous for credit unions.” “In particular, the amendment does nothing to restrict credit card interchange fees,” Mica noted. “Also, if a merchant sets a minimum credit card transaction amount, it has to be applied to all credit cards,” Mica said, adding that “these examples of changes made shortly before yesterday’s vote make clear that attaining further improvements is indeed possible.” The amendment “applies broadly to financial institutions and was not intended to single out credit unions.” However, Mica said, “the fact remains these amendments will negatively impact credit union interchange revenues.” For a credit-union specific summary of Durbin’s amendment, use the resource link.